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Health Law Is Dealt Blow by a Court on Mandate

The provision in President Obama’s health care law requiring Americans to buy health insurance or face tax penalties was ruled unconstitutional on Friday by the United States Court of Appeals for the 11th Circuit, in Atlanta.

It was the first appellate review to find the provision unconstitutional — a previous federal appeals court upheld the law — and some lawyers said that the decision made it more likely that the fate of the health care law would ultimately be decided by the Supreme Court.

The court found that Congress exceeded its powers to regulate commerce when it decided to require people to buy health insurance, a provision of the health care law known as the “individual mandate.” But the court held that while that provision was unconstitutional, the rest of the wide-ranging law could stand.

A 2-to-1 majority ruled that the mandate was beyond Congress’s power under the Commerce Clause of the Constitution, writing that “what Congress cannot do under the Commerce Clause is mandate that individuals enter into contracts with private insurance companies for the purchase of an expensive product from the time they are born until the time they die.”

The 11th Circuit case may have been the most closely watched of the health law cases wending their ways through the courts, in part because its plaintiffs included Republican governors and attorneys general from 26 states. But it was just the second of at least three appellate reviews. The Obama administration prevailed in the first round in June, when the individual mandate was found to be constitutional by the United States Court of Appeals for the Sixth Circuit, in Cincinnati. The next opinion is expected shortly from the Fourth Circuit in Richmond, Va.

Supporters and opponents of the law, known as the Affordable Care Act, expect that the Supreme Court will eventually decide the issue. Some lawyers said the fact that the Atlanta court created a conflict among courts of appeals made it more likely that the Supreme Court would hear the case as early as its next term, which starts in October.

The health care law — passed in 2010 after more than a year of wrangling, and frequently criticized by Republican presidential candidates and members of Congress — is intended to insure 32 million Americans by mandating that most people obtain health insurance, subsidizing policies for the poor and requiring insurers to accept people with pre-existing health problems.

Supporters of those provisions, which take effect in 2014, argue that without the insurance mandate, which brings more people into the insurance pool, it is unreasonable to require insurers to cover all applicants regardless of their health status.

The Cincinnati court ruled that the mandate was constitutional. The Atlanta court disagreed, in a majority opinion written by Chief Judge Joel F. Dubina, who was appointed by the first President George Bush, and Judge Frank M. Hull, who was named by President Bill Clinton. Judge Stanley Marcus, another Clinton appointee, wrote a dissent.

The majority opinion said, “This economic mandate represents a wholly novel and potentially unbounded assertion of Congressional authority: the ability to compel Americans to purchase an expensive health insurance product they have elected not to buy, and to make them re-purchase that insurance product every month for their entire lives.”

Their opinion overturned the part of a lower court ruling that would have thrown out the entire health care law: they ruled that while the individual mandate was unconstitutional, the rest of the law could stand.

The White House and the Department of Justice said they were confident that the law was constitutional.

Kevin Sack contributed reporting.

A version of this article appears in print on August 13, 2011, on page A11 of the New York edition with the headline: Health Law Is Dealt Blow By a Court On Mandate. Order Reprints|Today's Paper|Subscribe